MONTREAL, Aug. 26 /CNW Telbec/ - ExelTech Aerospace Inc. ("ExelTech" or the "Company") (TSX Venture: XLT.V), a leading aircraft maintenance, repair and overhaul ("MRO") provider with operations in Montreal and Quebec City, today announced its financial results for the first fiscal quarter ended June 30, 2008. All amounts are in Canadian dollars unless otherwise indicated.
Revenues for the quarter ended June 30, 2008 totalled $15.3 million compared to $13.7 million for the quarter ended June 30, 2007, an increase of 11%. This increase was driven by continued growth in ATR, Dash-8 and Saab regional turboprop heavy maintenance and in Montreal and Québec line maintenance services, which increased 28% and 83% respectively over the same period in the prior year, offset by reduced demand for regional jet maintenance, which declined 15%, primarily as a result of delays in leasing company contracts and changes in US regional airline flight schedules. The increase in regional turboprop heavy maintenance revenue reflects recognition of the revenue from a substantial aircraft refurbishment project, for which much of the work was accomplished in prior periods, and increased revenue from the Saab 340 maintenance line, which operated at full capacity throughout the quarter.
Despite this increase in revenue, Net Income declined to a loss of $1.3 million, compared to a profit of $18,791 in the same period in the prior year. This reflects in part lower margins caused by the change in value of the US dollar, the general market conditions in the MRO industry; and one-time training costs to meet the requirements of regulatory agencies; further training to expand our capabilities to meet increased demand for Embraer ERJ145, ATR 42/72 and Saab 340 heavy maintenance.
"We are disappointed to announce this loss", stated Derek Nice, ExelTech's Chairman and Chief Executive Officer. "Seasonally, our first quarter is always one of our weakest, but we are nonetheless not happy with these results. We are making strong advances in our plan to return to profitability."
Highlights of the quarter ended June 30, 2008 include:
- The company's ERJ145 heavy maintenance line operated at full capacity
throughout the quarter, making the ERJ145 ExelTech's most successful
product launch ever. Nonetheless, this was not enough to offset
declines in the Bombardier CRJ maintenance business caused by delays in
leasing company contracts and flight schedule adjustments by US
regional airlines that have reduced their flying in response to the US
airline industry slowdown. As a result, even though regional jet
maintenance revenues were 11% higher than in the previous quarter, they
declined 15% over the prior year period.
- Line maintenance revenue increased 70% over the previous quarter and
83% over the quarter ended June 30, 2007.
- ExelTech made substantial progress in implementing its business
re-engineering plan, driving higher efficiencies in all aspects of its
operations. During the quarter, the company appointed Mr. Sylvain Duval
as new President and Chief Operating Officer, with the mandate to
concentrate on internal operating efficiencies. Organizational changes,
investments in tooling and equipment, new training and other
initiatives are all making a contribution toward driving down the
company's costs while increasing service levels for all customers.
On August 21, 2008 the company officially opened its new Montreal heavy
maintenance facility, which is a major milestone in its plans for
industry-leading profitability.
About ExelTech Aerospace
The third-largest commercial airframe Maintenance, Repair, and overhaul
(MRO) vendor in Canada, ExelTech Aerospace is listed on the TSX Venture
Exchange and trades under the symbol XLT. The company holds Transport Canada,
US Federal Aviation Administration (FAA), European Aviation Safety Agency
(EASA) and Bermuda Department of Civil Aviation (BDCA) approvals to maintain a
range of aircraft and associated structures, components and systems. Aircraft
models serviced by ExelTech Aerospace include Bombardier CRJ and Embraer ERJ
regional jets, ATR42/72, Bombardier Dash 8 and Saab 340 family regional
turboprops and Boeing 737 narrow bodies.
With close to 310,000 square feet of hangar, shop and office space in
three facilities at Montreal and Quebec City, and with marketing offices in
the US and Europe, ExelTech Aerospace provides maintenance repair and overhaul
services to airlines in Canada, the US and 24 other countries around the
world.
To learn more about ExelTech Aerospace Inc. (TSX-V: XLT.V), please visit our
website at www.exeltech-aerospace.com.
The TSX Venture Exchange Inc. has not reviewed and does not accept
responsibility for the adequacy of this release.
SELECTED FINANCIAL INFORMATION OF EXELTECH AEROSPACE INC.
Consolidated statements of operations and
comprehensive (loss) income
Three-month period ended June 30 2008 2007
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Revenue $ 15,256,900 $ 13,702,948
Cost of sales 13,986,252 10,752,082
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1,270,648 2,950,866
Operating expenses 2,584,682 2,294,932
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(Loss) Earnings before the following (1,314,034) 655,934
Amortization 335,247 303,998
Financial expenses 175,158 281,512
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(Loss) Earnings before income taxes (1,824,439) 70,424
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Income taxes (487,471) 51,633
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Net (loss) earnings and comprehensive
(loss) income (1,336,968) 18,791
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Net (loss) earnings per share
basic and diluted (0.01) 0.00
Consolidated balance sheet
As at As at
June 30, March 31,
2008 2008
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$ $
ASSETS
Current assets 28,866,160 37,433,052
Capital assets 25,309,020 15,439,687
Intangible assets 256,086 294,836
Future income taxes 4,173,719 3,812,655
Goodwill 13,241,506 13,241,506
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71,846,491 70,221,736
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LIABILITIES
Current liabilities 21,573,493 18,788,155
Long-term debt and liability component of
convertible debentures 18,072,451 18,339,121
Other 544,449 457,083
SHAREHOLDERS' EQUITY 31,656,098 32,637,377
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71,846,491 70,221,736
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ContactsRoland Blais Chief Financial Officer
(514) 631-8999 ext 2400
rblais@exeltech-aerospace.com Derek Nice
Chief Executive Officer
(514) 631-3884
dnice@exeltech-aerospace.com
